Ch. 1 1 —Economic Considerations • 251 
what by industry, will cost an estimated $2.9 bil- 
lion (8). 
Projections of future expenditures depend on 
a number of factors, including the growth of the 
chemical industry and of R&D within it; the areas 
of R&D (e.g., new substances, new uses for old 
substances, new processes for making old sub- 
stances); regulatory policies, both domestic and 
foreign; the growth of the overall economy; tax 
policy; and further developments in nonanimal 
tests. 
International developments can have economic 
repercussions. For example, Swiss voters defeated 
in 1985 a referendum virtually banning all animal 
testing (see ch. 16). A number of companies have 
facilities in Switzerland, and such a change could 
have shifted testing to another country. Whether 
U .S . labs could compete for that business depends 
on the strength of the dollar. 
Toxicological Testing Services 
In 1984, the toxicity testing industry in the 
United States was estimated to be worth about 
$650 million per year (27). Sixty-five percent of 
the testing is done by corporations in-house. The 
remaining 35 percent (about $225 million annu- 
ally) is conducted by commercial laboratories, 
universities, and other organizations. Although 
there are over 110 U.S. laboratories that sell test- 
ing services, most specialize in a small number 
of assays and are not “full service.” Hazelton is 
the largest of the full -service labs, with domestic 
sales of $36 million in 1983. Except for Hazelton 
and several other large commercial labs, the in- 
dustry is a dispersed one, with the many small 
commercial firms accounting for approximately 
two-thirds of the value of domestic sales (10). 
The industry expanded its facilities in the 1970s 
in response to Federal regulatory changes and the 
passage of the Toxic Substances Control Act. Test- 
ing did not increase as much as expected, how- 
ever, and in the early and mid-1980s the indus- 
try was operating at 60 to 70 percent capacity (27). 
This has led to fairly level prices over the past 
few years and, in some cases, price cutting to 
maintain market position. Because of this com- 
petition, current prices reflect the actual costs of 
testing. Testing laboratories often do not quote 
set prices for some testing procedures or for par- 
ticular batteries of tests, preferring to negotiate 
on a case-by-case basis. 
Government Toxicological 
Research and Testing 
The U.S. Government programs with strong ties 
to toxicological testing are EPA, the National Cen- 
ter for Toxicological Research in the Food and 
Drug Administration, the Centers for Disease Con- 
trol, and the National Institutes of Health (see table 
11-3). Other programs are not identified with sep- 
arate budget line items and are dispersed among 
various agencies and departments. 
Table 11-3.— Selected Federal Expenditures Related 
to Toxicological Testing and Research, 1984-86 
(in thousands) 
1984 
1985 a 
1986 a 
Environmental Protection Agency: 
Program expenses 
. $327,145 
$380,341 $376,074 
Toxic substances 
. 34,484 
39,341 
38,660 
Pesticides 
Research and 
. 32,772 
37,805 
36,948 
development 
. 144,903 
195,449 
212,061 
Toxic substances 
12,327 
14,450 
26,358 
Pesticides 
1,738 
5,121 
6,938 
Interdisciplinary 
18,522 
22,423 
14,876 
Food and Drug Administration: 
National Center for 
Toxicological Research 
. 21,132 
21,575 
22,284 
Drug program 
. 138,248 
153,112 
152,430 
Food program 
Devices and radiologic 
. 115,541 
109,538 
113,907 
products 
62,568 
67,081 
68,368 
Centers for Disease Control: 
Occupational safety and 
health research 
Research on chronic and 
54,740 
54,863 
57,645 
environmental disease . 
. 25,953 
28,568 
23,726 
National Institutes of Health: 
National Cancer Institute: 
Cause and prevention . . 
Detection and 
. 276,075 
301,655 
285,844 
diagnosis 
63,182 
70,524 
66,839 
Treatment 
. 340,041 
367,940 
351,683 
National Institute of Environmental and 
Health Sciences: 
Characterization of 
environmental 
hazards 
19,152 
21,136 
21,601 
Applied toxicological 
research and testing. 
. 57,781 
57,303 
56.737 
Intramural research 
48,643 
55,051 
52,536 
Estimates. 
SOURCE: U.S. Executive Office of the President, Office of Management and Budg- 
et, Budget of the United States Government, Fiscal Year 1986 (Washing- 
ton, DC: U.S. Government Printing Office, 1985). 
